Popular

May 22, 2006

Attorney pleads guilty in Milberg case

by Sam Savage

By Gina Keating

LOS ANGELES (Reuters) - A Los Angeles attorney has admitted
to passing illegal kickbacks from Milberg Weiss Bershad Hynes &
Lerach, the nation's No. 1 class action law firm, to a
plaintiff as part of a widening federal probe, according to
court documents filed on Monday.

The firm, now known as Milberg Weiss Bershad & Schulman,
and two senior partners, David Bershad and Steven Schulman,
were indicted last week by a federal grand jury in Los Angeles
for orchestrating a kickback scheme in which it paid clients
for acting as plaintiffs in its lawsuits.

Bershad and Schulman, who managed the firm's finances,
denied the allegations last week and vowed to exonerate
themselves.

A spokeswoman for Milberg Weiss, which also has denied
wrongdoing, could not be reached late on Monday for comment on
the latest allegations.

On Monday, attorney Richard Purtich became the second
person to plead guilty to charges stemming from the alleged
scheme, and to agree to cooperate with prosecutors, according
to a plea agreement filed in federal court in Los Angeles.

His lawyer could not be reached for comment.

Purtich, 53, faces up to three years in prison if convicted
of the single tax fraud charge against him. He is scheduled to
be arraigned next month.

According to the plea agreement, Purtich said he and law
firms he was associated with received checks totaling $3.5
million from Milberg Weiss between 1992 and 1996 and passed
them on to Beverly Hills eye surgeon Steven Cooperman.

Cooperman and his relatives acted as plaintiffs in dozens
of Milberg Weiss cases between 1981 and 2004, according to the
indictment against the firm.

Purtich reported the kickback payments to the IRS as his
own income or that of the law firms, and in doing so, concealed
income that Cooperman received from Milberg Weiss, according to
the plea. That is the basis of the single tax fraud charge
against him.

Purtich admitted in the plea that neither he nor the law
firms that received the checks made any referrals or performed
any work to earn the payments from Milberg Weiss.

Another Milberg client, Howard Vogel, pleaded guilty last
month to taking $2.5 million in kickbacks from Milberg Weiss
and lying about it in sworn court documents.

Vogel, a retired mortgage broker, was the first to plead
guilty in the six-year-old federal probe against Milberg Weiss.

In addition to Bershad and Lerach, two other people have
been indicted in the case.